Question

Does a local club pro qualify for the QBI deduction

Forum|Forum|2 years ago
March 12, 2024
1 reply
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Is income (or loss) earned by a local club pro who files a Schedule C considered QBI?

Yes, the local club pro qualifies to take the QBI deduction. According to the IRS a qualified trade or business is a business involving the performance of services in the fields of health, law, accounting, actuarial science, performing arts, consulting, athletics, financial services, investing and investment management, trading or dealing in certain assets, or any trade or business where the principal asset is the reputation or skill of one or more of its employees or owners.

If you would like more information see Tax Cuts and Jobs Act, Provision 11011 Section 199A - Qualified Business Income Deduction FAQs

S

Spanky11Author

My client has filed a Schedule C for years, but because he was unsure about the QBI deduction, he has never claimed that or reported his business as QBI. Can he begin claiming QBI in 2023 if he has never claimed in prior years (since the deduction became available)? It looks like he is going to have an operating loss this year which I assume will carry forward, but I wonder how the accumulation of net income/loss from prior years affects things? I assume you need to be consistent in whether you identify the business as QBI from year-to-year and cannot pick and choose the years you do so.

KrisD15

You can amend up to three prior year returns to claim QBI if applicable.

The Qualified Business Income Deduction allows 20% to be reduced from income before tax. It is not a gain that is carried forward, although a loss could be.

As a Golf Pro, the business would be considered a SSTB Specialized Service Trade or Business, so depending on the income, the QBI may be limited or may not be applied.

IRS Link

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